Research business bank accounts - what advice would you offer to a small business regarding their banking when starting up
Starter (10 mins)
Cash flow - we all have it! Write 2 lists for the incoming and outgoing cash flow in YOUR life....
Key Words
Information (5 mins)
Cash Flow Forecasting
Part of the planning stage of a business is to produce cash flow forecast to give a prediction of how cash will flow I and out of the business in the future. This forecast will help the entrepreneur decide if the business is viable and identify any areas of weakness and plan action accordingly.
Cash Flow
Cash flow is the money going in and out of a business. It consists of inflows (money coming in) and outflows (money going out). The net cash flow is the inflow – outflow. Any business should keep copies of all receipts and invoices to properly account for their cash flow. Any business without sufficient cash flow will be unable to pay its bills/wages and will become insolvent.
Task (10 mins)
Create a cash flow diagram for a bouncy castle business
Information (5 Mins)
Cash Flow Forecasts It is vital to plan ahead to make sure that a business will have sufficient cash to survive, the business may have good months and bad months. In the example below we see a start up business with a high initial stock cost and low ongoing costs, however this is a largely seasonal business and takings are higher in summer.
The cash flow forecast is -
part of the business plan
helps to show if action would need to be taken to avoid a cash crisis
can be used at the bank to help get a loan
Task (25 mins)
Create a cash flow spreadsheet for your bouncy castle business
Forecasting cash flows
Lesson 1 Lesson 2 Lesson 3 Lesson 4 Lesson 5 Lesson 6 Lesson 7 End of Unit Test
Starter (10 mins)
Cash flow - we all have it! Write 2 lists for the incoming and outgoing cash flow in YOUR life....Key Words
Information (5 mins)
Cash Flow Forecasting
Part of the planning stage of a business is to produce cash flow forecast to give a prediction of how cash will flow I and out of the business in the future. This forecast will help the entrepreneur decide if the business is viable and identify any areas of weakness and plan action accordingly.Cash Flow
Cash flow is the money going in and out of a business. It consists of inflows (money coming in) and outflows (money going out). The net cash flow is the inflow – outflow. Any business should keep copies of all receipts and invoices to properly account for their cash flow. Any business without sufficient cash flow will be unable to pay its bills/wages and will become insolvent.Task (10 mins)
Create a cash flow diagram for a bouncy castle businessInformation (5 Mins)
Cash Flow Forecasts
It is vital to plan ahead to make sure that a business will have sufficient cash to survive, the business may have good months and bad months. In the example below we see a start up business with a high initial stock cost and low ongoing costs, however this is a largely seasonal business and takings are higher in summer.
The cash flow forecast is -
Task (25 mins)
Create a cash flow spreadsheet for your bouncy castle businessUse the data below (starts in Jan)
Assume you have an opening balance of 0
Formulas will only require a + or -
Plenary (5 mins)
How could the cash flow spreadsheet help with your business plan?